[P2P-F] bitcoin critique summary

[James Wallbank]

Hello All,

One way to distill this critique further would be to suggest that 
conventional exchange systems (i.e. money) are measured in one-dimension 
(quantity) whereas value is a multi-dimensional concept.

At Access Space we work with (at least) three value dimensions: Exchange 
Value (which maps onto money value) Symbolic Value (how cool it is, or 
what it means in symbolic terms) and Utility Value (how useful it is). 
(Arguably, we also work with a fourth value metric: Time).

One value dimension can sometimes be traded for another, but not always 
at a constant rate. In some cases value exchange between systems is 
impossible.

You can see examples of business models which exploit these other value 
dimensions. For example, Harley Davidson produce and sell aftershave to 
exchange some of their symbolic value (Harleys are cool!) for Exchange 
Value. However, if they over exploit the exchange, they'll cease to be 
cool, because people will realise that they're an aftershave 
manufacturer, with a bike-orientated publicity strategy - which isn't 
cool at all.

In our media lab we exploit discontinuities between value systems - we 
recycle computers for use in the lab and the community. Three or four 
year old computers are not cool - they're in a trough of low value. 
Inefficient software gives the false impression that they have low 
utility value. Users are generally insufficiently skilled to optimise 
their functions, so they appear to have low utility value.

We refurbish the computers, optimising their utility value, and rebrand 
them as "green" and "anti-corporate" technology, which increases 
symbolic value in niche markets. (Although notice that "mainstream" 
symbolic and exchange value is still very low, as greenness is eclipsed 
by a marketing push to misinform users about utility value).

We also re-value participants themselves. Unemployed people may have low 
exchange capacity (i.e. no money) and low symbolic value (it ain't cool 
to be kicking your heels). But thye have high utility value - they have 
available time which can be exchanged for skill-acquisition and creative 
activity.

Notice the way that throughout history people who are disempowered by 
mainstream valuation systems have used the creative, symbolic value axis 
as a route to increased valuation. (Born in the ghetto? Got no cash, no 
useful skills? Maybe - but the way he walks has style!) Notice also how 
value along many axes is a slippery concept - keep something 
unfashionable long enough and it regains value (e.g. old computers lose 
utility but gain retro-chic).

Sometimes exchange rates across value axes are proportional, but in 
other cases they may be unrelated, or even inversely proportional.

As small elites becomes increasingly (and unjustifiably) super rich, 
they cannot help but become less free (lowered utility value) and less 
cool (lower symbolic value). If their symbolic value bottoms out, 
revolution happens and people end up hanging from lamp posts. (c.f. The 
Arab World, 2011.)

Let's hope that re-understanding of valuation occurs before negative-sum 
unpleasantness.

Best Regards,

James
=====

On 20/05/11 10:43, Jack Marxer wrote:
> I think this is a very concise and valuable criticism of money as we 
> know it.
>
> Jack
>
> On Fri, May 20, 2011 at 8:06 AM, Karl Robillard <krobillard at san.rr.com 
> <mailto:krobillard at san.rr.com>> wrote:
>
>     I don't see how the alternative currency experiments like Bitcoin
>     do anything
>     to help us move to a more egalitarian, steady-state economy.
>
>     An economist will tell you that "price is information", but I'm
>     not sure how
>     they justify that.  An ounce of crack, a few hours of music
>     lessons, a lawn
>     mower, or a couple hours of labor might all be $100.  None of
>     these can
>     remotely be considered the same, but yet the dollar value is
>     identical.  Any
>     mechanism which equates these is an absurd abstraction which
>     eliminates a
>     great deal of useful information.  This dearth of relational data is a
>     fundamental feature of money which turns the economy into a
>     valuation game.
>     Over time, the wealth gap between those who game the system well
>     and those
>     that don't becomes so great that a jubilee or a revolution is needed.
>
>     I see open source production and modern information technology as
>     powerful
>     tools which allow us to more fully value things.  They are
>     important because
>     they help make money (just a primitive form of information
>     technology, IMO)
>     obsolete.  I just don't understand why people want to continue to
>     treat the
>     economy as a game.
>
>
>     -Karl
>
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-- 
James Wallbank
CEO, Access Space Network Ltd.
Access Space, Unit 1, AVEC Building, 3-7 Sidney St, Sheffield S1 4RG
Access Space is UK Registered Charity: #1103837
Tel: +44 (0)114 2495522
Fax: +44 (0)114 2495533
Web: http://access-space.org

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